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The blue dollar resumes the climb: the five keys that explain the rise

2021-04-29T18:58:57.970Z


After a downward summer, the informal segment has already increased 18 pesos in two weeks. Annabella quiroga 04/27/2021 12:40 PM Clarín.com Economy Updated 04/27/2021 12:40 PM The blue dollar does not stop. This Tuesday it opened up again and with a rise of three pesos it already reaches $ 161, which is only two pesos below the saving dollar, which is sold at $ 163. Why did the dollar blue wake up after a calm summer in which it dropped 27 pesos? These are the five keys that explain


Annabella quiroga

04/27/2021 12:40 PM

  • Clarín.com

  • Economy

Updated 04/27/2021 12:40 PM

The blue dollar does not stop.

This Tuesday it opened up again and with a rise of three pesos it already reaches

$ 161,

which is only two pesos below the saving dollar, which is sold at

$ 163.

Why did the dollar blue wake up after a calm summer in which it dropped 27 pesos?

These are the

five keys

that explain the rise in the price.

Inflation on the rise

The 4.8% inflation figure shook the market, which expected a somewhat lower record.

And it consolidated a perception that was gaining weight in Argentine pockets: with inflation on the rise, blue at $ 139 - the price of April 7 -

was "cheap."

The March data and the 13% accumulated in the first quarter pulverized Minister Martín Guzmán's aspirations for inflation to close the year at 29%.

The consulting firms, which until last month had been correcting the annual projections downwards, are now updating them from 46% to

a zone closer to 50%. 

The higher expected inflation, the greater the tendency to dollarize.

Thus, the demand that was "ironed" began to increase.

Low rates in pesos

The monetary policy rate, which the market takes as a reference, has been

frozen at 38% since last year.

And the Central Bank insists that it is not analyzing updating it.

Thus, the classic fixed terms for retailers pay

rates of 37%

, at least ten percentage points below expected inflation.

And although in recent months there has been a boom in fixed terms that adjust for price rises, that is, they pay

above real inflation

, the uncertainty about what is coming increases the trend towards dollarization.

The supply drop

In the final quarter of last year, the blue dollar

peaked at $ 195

.

Many savers over-dollarized in those months and in the summer had to go out and sell tickets to face vacation expenses, rising inflation and pay off debts. 

In addition, in recent weeks the informal market had been supplied in part by the people affected by

the Wealth Tax,

who had to part with pesos to cover that maturity.

But that trend was cut last week, taking volume out of the market and pushing the price higher.

The rise in financial dollars

Although the blue is an informal market, it usually takes as a reference what happens with financial dollars,

the cash with liquid (CCL) and the MEP

.

These are legal operations - and they do not have a monthly quota - in which dollars can be accessed through the purchase / sale of shares and bonds on the stock market.

In the exchange rate summer, the price of these dollars remained stable because the Central Bank

intervened in that market:

every day it sold bonds to prevent the price from soaring and the CCL and the MEP raised the exchange gap and put pressure on inflation.

But in recent days the Central Bank ran away from this market.

And instead of using the dollars that he pockets every day as a result of the high liquidation by the field to buy and sell bonds, he began to use them to

reinforce the reserves

.

Thus, for the first time in six months, the reserves crossed the ceiling of US $ 40,000 million.

With the Central out of the game, the CCL and the MEP rose between 6 and 7% in the month and pushed the blue, although it has

already increased 12%

so far in April.

The second wave of Covid

The

increase in infections

also shot the dollar.

The fear of more restrictions on activities causes those with a few pesos to rush to buy to "protect themselves" in case they have to stop working.

And at the same time, the greater restrictions

put pressure on public spending,

since the Government will have to allocate more funds to attend to those hardest hit by the closures.

In a country without access to debt markets, more public spending translates into more monetary issuance, which will lead to more pressure on inflation and the dollar.

AQ

Look also

Why is the gap between the blue dollar and the official one again the thermometer that economists look at?

With the official dollar stepped on, 500 companies presented precautions to allow them to import

Source: clarin

All business articles on 2021-04-29

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